Research On Credit Decision-making Of International Insurance Policy Financing In Supply Chain Under The Background Of Blockchain

The international insurance policy financing business of supply chain under the background of blockchain creates a credible environment for banks to provide insurance policy financing business by combining trade credit insurance,supply chain finance and blockchain technology to ensure that accounts receivable is genuine and repayable.However,blockchain technology does not solve the information asymmetry between the borrower and the lender in the insurance policy financing business,and the manufacturer’s adverse selection problem derived from the information asymmetry exposes the bank to uncertainty risk when providing insurance policy financing,which in turn reduces her willingness to provide the business.This paper employs principal-agent theory to investigate how the bank makes credit decisions to cope with the adverse selection problem of the manufacturer undertaking policy financing on the blockchain platform.By using the individual rationality of the manufacturer and the bank and the incentive compatibility of the manufacturer as constraints,credit decision models are developed to analyze the credit policy of the bank under conditions of maximum the bank’s expected profit in the monopolistic market and maximum the manufacturer’s expected profit in the perfectly competitive credit market,including the probability of lending,the interest rate,and the amount of collateral.It is found that the manufacturer can adjust the bank’s credit policy indirectly by overpaying for trade credit insurance premiums.In addition,under asymmetric information conditions,the bank in the monopolistic credit market does not require insured accounts receivable from the manufacturer but credit rationing to the high-risk manufacturer occurs.In the perfectly competitive credit market,insured accounts receivable is required from the manufacturer.And all manufacturers can obtain credit if their insured accounts receivable is sufficient,otherwise credit rationing to the low-risk manufacturer occurs.Finally,blockchain technology can enable flexible division of insured accounts receivable according to actual financing needs and create more social welfare.This study innovatively studies the credit decision-making problem of international insurance policy financing of supply chain under the background of blockchain from the perspective of the bank,and designs a credit decision mechanism for banks and other financial institutions that provide small loans to manufacturers to help them quickly verify the authenticity of the insured accounts receivable on the blockchain and thus make efficient credit decisions,as well as to inform manufacturers’ insurance practices and help them obtain more favorable credit policies.